* Elcoteq said it had stopped deliveries of "Kin"
* Company repeats it sees positive operating profit in H2
* Elcoteq shares close 14 pct lower
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HELSINKI, July 1 (Reuters) - Finnish electronics company Elcoteq ELQAV.HE said it expected its operating profit to turn positive in the second half despite Microsoft's decision to scrap the sale of "Kin" smartphones in Europe.
Shares in Elcoteq fell sharply on Thursday and closed 14.6 percent down at 1.40 euros, compared with a 1.9 percent weaker Helsinki bourse general index .OMXHPI.
The company said it had stopped deliveries of the smartphones to Sharp (6753.T) after Microsoft's (MSFT.O) said it would cancel its plan to sell the phone in Europe this autumn. [ID:nN30263569]
"Elcoteq has already delivered to Sharp the Kin smartphones for the U.S. markets with revenues amounting to more than one-third of the original guidance for Sharp business in 2010," it said in a statement, adding that the total guidance for the Sharp business came to 150 million euros ($183.5 million).
Microsoft said the internal team working on the "Kin" phones would be combined with the group working on Microsoft's forthcoming Windows Phone 7 software. ($1=.8172 Euro) (Reporting by Terhi Kinnunen and Brett Young; Editing by Sharon Lindores)